Had you bought $1,000 worth of Alibaba (NYSE: BABA) stock at its all-time high of $317 in late 2020, you would have just $230 today -- a decline of 77%. And while the company's valuation now looks attractive compared to those of e-commerce rivals like Amazon, investors should keep an eye on its slowing revenue growth and the increasingly unpredictable regulatory environment in China. Let's dig deeper. 

With a market share of 47%, Alibaba is the undisputed leader in Chinese e-commerce. And its influence extends across several industries, including brick-and-mortar retail, logistics, and cloud computing (where it controls 37% of that segment). Alibaba's scale gives it an economic moat through network effects. More customers attract more merchants, which increases competition and the quality of product listings. The e-commerce business also creates a "captive" market for other services like payment processing and other financial services.  

Until recently, Alibaba's many advantages helped it maintain a healthy growth rate, with revenue rising 32% year over year to $28.6 billion in 2021. But now a top-line deceleration, coupled with a harsh and unpredictable regulatory environment, makes its future look grim. 

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Source Fool.com